They say there is an exchange traded fund (ETF) strategy for just about everything you can imagine. Now there’s an ETF strategy that tracks blockchain and cryptocurrency strategies for investors, with two ETFs launching. The real question is whether the strategy is adequately targeted, and perhaps even if the strategies can be targeted in a traditional ETF structure.
It has been reported that the Securities and Exchange Commission removed the word “blockchain” from the actual names. The SEC and other regulators have warned about the speculation behind blockchain, bitcoin and cryptocurrencies.
Amplify ETFs announced today that the Amplify Transformational Data Sharing ETF (NYSEARCA: BLOK) has launched. This ETF launched with just $2 million in holdings, and the fund will hold publicly traded global companies leading in research, investment and revenue creation related to blockchain-based and other distributed ledger technologies.
Blockchain is a revolutionary technology that has the potential to redefine enterprises, ecosystems and economies, transforming the way data is shared. The Amplify Transformational Data Sharing ETF provides access to an actively managed basket of global companies at the forefront of blockchain-based technology. This responsive portfolio management approach allows the ETF to adjust to the daily pace of blockchain-related investment opportunities and risks.
The top 10 holdings were listed as follows:
- Taiwan Semi, 6.07%
- Digital Garage, 5.52%
- SBI Holdings, 5.52%
- Overstock.com, 5.27%
- IBM, 4.46%
- NVIDIA, 4.38%
- Square, 4.23%
- HIVE, Blockchain 4.17%
- GMO, Internet 4.12%
- SAP, 2.98%
Reality Shares has announced the launch of its own ETF to invest in leading global companies creating and implementing blockchain solutions. The Reality Shares Nasdaq NexGen Economy ETF (NASDAQ: BLCN) will hold between 50 and 100 constituents at any given time and will be rebalanced semiannually. It tracks the new underlying index called the Reality Shares Nasdaq Blockchain Economy Index, which is made up of companies committing material resources to blockchain technology.
The companies in the ETF have to have a role in blockchain ecosystem, have a blockchain product stage and a blockchain economic impact, and they have to be in Blockchain Institute membership. The companies also have to have R&D expenses, along with company filings and innovation. Some of the companies highlighted in the holdings were listed as follows:
- HIVE Blockchain
Note that these two ETFs are launching exactly at the same time that bitcoin went under $10,000 — about half of its peak from just a month ago.